Truck, rail sectors look at economy for the long haul

The Association of American Railroads (AAR) announced earlier this year that the nations major railroads are expected to invest a record $13 billion in 2012 to expand, upgrade and enhance the nations freight rail network. The railroads also expect to hire more than 15,000 employees this year, replacing retiring workers and adding new positions nationwide.

Unlike trucks, barges or airlines, Americas freight railroads operate on infrastructure they own, build and maintain themselves so taxpayers dont have to. And this year, theyre investing at a record rate to meet the demands of the recovering economy, said Edward R. Hamberger, AAR president and chief executive officer. These investments help businesses get their goods to market more efficiently and affordably so they too can innovate, invest and hire. Thats how freight rail spurs the American economy and supports jobs all across the country.

Investments in privately owned freight rail networks have reached record levels in the past three years, with hundreds of infrastructure projectsincluding work on intermodal terminals that facilitate truck-to-train freight transport; new track, bridges and tunnels; modernized safety equipment; and new locomotives and rail carsunder way nationwide, Hamberger said. In recent years, railroads have been spending about 17 percent of their annual revenue on capital expenditures vs. 3 percent by the average U.S. manufacturer.

On the trucking side, year-to-date tonnage has risen 3.8 percent from 2011, according to the American Trucking Associations (ATA). However, the ATAs advanced seasonally adjusted For-Hire Truck Tonnage Index fell 1.1 percent in Aprilthe most recent month for which official figures were availableafter increasing 0.6 percent in March.

While just one month, the April decrease matches with an economy that is likely to grow slightly slower in the second quarter than in the first quarter, said ATA chief economist Bob Costello. He said the industry shouldnt expect the growth rate it has seen over the past couple of years, when tonnage increased 5.8 percent in both 2010 and 2011, calling annualized growth in the 3- to 3.9-percent range more likely.

Have your say

All comments are subject to editorial review.
All fields are compulsory.